How ready is your billing data ?

Summary

In the process of taking raw information and transforming it into a billed invoice, charges can be introduced into billing with different levels of pre-processing. Charge details can vary depending on its source, the arrangement (topology) between the biller's applications, the degree of pre-processing performed, and the biller's strategic direction for their billing environment. New networks, billing consolidation and application replacement can all influence how a biller uses rating-, pricing- and invoice-ready interfaces to operate their billing environment.

Actions

Consider how pricing and invoice-ready interfaces can be used as alternative (interim) solutions to a direct migration approach
To support speed-to-market for new network offerings, consider temporary, adjunct rating (and billing) platforms rather legacy upgrades
If considering pre-paid bundles, review your application environment to confirm that accurate real-time rating can be performed
Confirm that pre-calculated amounts (e.g. taxes calculated elsewhere) are carried through the billing process unchanged

Rating-, Pricing- and Invoice-ready billing data

Rating-ready

Rating-ready charge data is the raw information from the network (e.g. telephone, utility, tollway) or a business partner (e.g. roaming, 3rd party). The charge details are present, but no processing to determine the chargeable amount has yet been performed. This information may be supplied in a variety of inbound network-specific formats with charge fields specific to the network - from electricity and gas network equipment, from mobile and internet network elements.

Since the raw network data fields are available, rating-ready interfaces provide the maximum choice on how a charge will be assessed. The combination of network, customer and marketing (rate) information provides the widest opportunity to differentiate a charge's price.

The rating of network charges can be performed using a centralised, consolidated approach, or applied in streams to separately rate different networks (e.g. mobile phones, internet), or product offerings (e.g. mobile data, mobile voice).

Separate rating streams provide flexibility at the cost of reducing the bundling options. As well, new rating platforms can be used to supplement legacy rating for new product offerings and networks, thereby avoiding the need to perform complete system upgrades. Speed-to-market for new products can be achieved in a new rating platform whilst maintaining the stability of existing rating platforms (assuming a consolidated, cross-platform bundling capability is not required).

Pricing-ready

Pricing-ready charge data already has an initial price placed upon it, though this can be changed when whole-of-invoice (re)pricing is performed (e.g. discounting). Charges may be re-rated (especially for bundled pricing) during the regular bill cycle, but since some network information may have been discarded, there may not be the same number of determinants available for differentiation.

Pricing-ready charges may be supplied by external, upstream rating systems and other business partners before being placed into a pre-bill repository. Customers can then review their network use in this repository prior to the generation of their regular invoice.

Invoice-ready

Invoice-ready charge data brings together priced charges from (possibly) multiple points for formatting and distribution. In effect, this processing is that of an 'invoicing engine' that operates as centralised corporate infrastructure. Data is sourced from upstream systems and is sent elsewhere with no persistent customer data held in the invoicing application.

Alternative solutions may store invoice details locally within the invoicing application for electronic presentation to customers (e.g. EBPP) and billing staff. Due to the volume of data that billing generates, these alternative solutions will generate quite different data storage requirements than a pass-through solution.

Since this is 'presentation' processing, the information required for processing is reduced. Only the formatting details, destination address, and the charges themselves are required. No further financial manipulation is performed apart from summarisation (at different levels) and the segmentation of charges into different invoice sections.

Solution Trade-offs

Different solutions generate trade-offs in the capabilities they deliver and the operational complexities that they generate.

Constraints on bundle pricing: The separate rating of different products means they may not be priced (at rating) based on the presence, absence or quantity of other products in the bundle. This can be remediated by re-rating bundled charges as part of the billing cycle, but this generates rework and the need for increased processing infrastructure. Bundling is important as it is used both to capture more of a customer's spending (i.e. purchase here and get a better overall price), and to reduce their likelihood of churning away to a competitor (i.e. improves customer stickiness)
Coordination: Cut-off timing can generate complex dependencies in the billing cycle to allow charges to be collected in a timely manner and placed upon the customer's invoice. This can also be the case when invoice-ready charges are aggregated in an invoicing engine to generate a 'single bill'.
Discovery: When many rating and billing platforms are involved in the billing process, users and support staff need to look in many places to research and solve problems.
Development: A complex operating environment needs a careful design approach to ensure all applications are considered when changes are made. As well, the additional interfaces that a fragmented operating environment contains translate into higher costs during future development and migrations.
Data Maintenance: Distributed platforms need careful customer data maintenance (i.e. update replication) to ensure that, during rating, network charges vary based on customer characteristics use accurate values.
Pre-bill: Customers who review their charges prior to billing will prefer / require that the charges are accurate when compared with their invoice. The bill cycle can perform additional discounting, but the expected pre-bill amounts should be tailored to the customer and not rely on generic values. Consumers may view their services through a biller-supplied self-service portal, or when talking with the biller's staff. Corporate customers may have their pre-bill details supplied electronically ahead of their regular billing cycle.
Pre-paid: To avoid exposing the biller financially, accurate real-time pricing is required to limit customers' spend to their pre-paid balance. The correct amounts for network usage must be accurate when calculated as they can't wait for a scheduled billing cycle to be re-rated or confirmed.

Application Consolidation

Multiple, separate billing platforms can be gradually consolidated into one strategic platform by supplying charge data with different levels of readiness.

Initially, invoice-ready details could be supplied to the strategic platform for inclusion on a consolidated invoice. Subsequently charges rated on the separate billing platforms could be supplied 'pricing-ready' for earlier inclusion in the billing cycle, and possible repricing. Finally, the raw network usage could be supplied to the strategic platform directly for maximum rating flexibility. The legacy billing platforms could then be decommissioned.

Pre-calculated tax and charge amounts

Charges supplied by business partners can contain pre-calculated amounts that must be preserved through to the invoice. For example, tax amounts supplied with pricing-ready charges need to be carefully processed to retain clarity on where the liability for the tax calculation lies. If the charge's price is changed, the taxes to be collected may vary, and the necessary information to recalculate the tax accurately may no longer be available on the charge record.

Tags: Billing, Interfaces